St. Paul Port Authority lands Southport Terminal tenant

Earth-moving equipment was already in place at St. Paul’s Southport Terminal on Monday as Form-A-Feed prepares to construct a 60,000-square-foot facility for the feed and fertilizer company’s Ingredient Transport business. (Staff photo: Bill Klotz)

The St. Paul Port Authority has landed its first new business in the city’s Mississippi River harbor in decades, with Stewart, Minn.-based Form-A-Feed expected to start moving earth soon for a 60,000-square-foot shipping facility at the Southport Terminal just south of Holman Field.

The building could eventually house manufacturing for the feed and fertilizer company’s Ingredient Transport business. It is expected to cost $5 million to $7 million to build. Cold Spring-based Doug Carlson Development is handling construction and design, and Maple Grove-based Loucks Associates is the engineer.

Construction on the building is expected to start in spring 2013 at the 637 Barge Channel Road site, wrapping up before the end of the year.

For Port Authority officials, Form-A-Feed validates the agency’s decision to spend roughly $5 million in state and authority funds to construct a new dock wall and storm water management system at the Southport Terminal, said Kelly Jameson, the Port Authority’s vice president of property development.

The dock wall project, completed in 2010, opened up some land for development on the north side of the barge slip, next to an U.S. Army Corps of Engineers dredge material site. Operations on the south side of the barge slip, Alter Corp.’s metal recycling operation and chemical manufacturer Hawkins’ shipping terminal, go back to the 1960s.

“We put this investment into a new wall so that we could put new shipping in,” Jameson said.

There is no more space for further development at the Southport Terminal. But the Port Authority plans to study ways to renovate the ports to bring in more tenants, especially with Minneapolis potentially closing its industrial river terminal to barge traffic in coming years.

“As leases are expiring, we’re looking at what land we have along the river and how we can more densely put people there, because once we built this wall, we actually found that there’s a demand out there for people to be on the river,” Jameson said.

A handful of other companies expressed interest in the site. The Port Authority chose Form-A-Feed because it is more than 30 years old, had capital available and was able to move right away on the project, Jameson said.

Form-A-Feed’s headquarters is a 110,000-square-foot manufacturing and office facility at 740 Bowman St. in Stewart, about 70 miles west of Minneapolis. The company presently relies on rail and trucking to get raw materials to Stewart and then to customers, Form-A-Feed President Steve Nelson said in statements related through his assistant and daughter, Stephanie Nelson.

“Having the river operation will allow us to go direct from barge to the customer. … Having a river location has always been a goal of the business. This location was a great opportunity for us,” Nelson said.

Both fertilizer and feed will move through the facility, with the company initially planning to hire eight to 12 equipment operators, administrative staff, and a manager.

Tens of thousands of tons of feed and fertilizer are expected to move through the facility during its first year, and there could be potential in coming years for additional activities, such as manufacturing. The company is even considering a plan to mix some of the river dredging at the port with fertilizer so it can be used at Minneapolis-St. Paul golf courses.

“They have a good business, and they seemed to be a good fit,” Jameson said of Form-A-Feed and the port.

The Port Authority’s Board of Commissioners in August approved a 15-year lease for Form-A-Feed, with two five-year-renewal options. The lease has Form-A-Feed paying the Port Authority more than $800,000 between 2012 and 2027. There were no economic development incentives related to the move, Jameson said.

Form-A-Feed successfully won approval from the Army Corps to wedge in its facility by the dredging piles. Jameson said the project only has some minor planning details left to work out with the city of St. Paul.

“There’s nothing major … They have quite a bit of earthwork to do first,” Jameson said.

In order to ensure the facility is above the level of a 100-year flood, Loucks Associates officials figured that earth would have to be stacked up to raise the level of the building by 2 feet, said Nick Mannel, principal civil engineer at Loucks.

Soil at the site is also clay-like and sandy, creating the need to drive long steel pylons into the earth and requiring construction of a 1- to 2-foot-thick foundation to ensure a stable structure.

Luckily, there was plenty of earth to use at the site already, thanks to the Army Corps dredging work. The sandy soil from the middle of the river channel is well suited for building, Mannel said.

“It’s a really good opportunity that the Corps of Engineers is bringing the sand into the area,” Mannel said.